Specifications

76 Business & Commercial Aviation ■ May 2012
www.AviationWeek.com/bca
Business Airplanes
the current number. Gulfstream has more
than 80 aircraft in China and says that the
Asia-Pacific region accounts for 27% of its
backlog, most of which will go to China.
Africa also holds promise for business
aviation, in large part because of surging
Chinese investments there in energy, trans-
portation and metals. It’s 6,600 nm from
Shanghai to Lagos, Nigeria, and nearly
7,000 nm from Shanghai to Cape Town,
South Africa — distances that help ensure
more long-range, large-cabin business
aircraft will enter service in this region.
Light and midsize aircraft manufacturers
suffered through more rough weather last
year. Bombardier delivered 24 Learjet
40-series aircraft, half the number that
it averaged before the recession. Cessna’s
billings ticked up to 183 units, but that’s
still down 60-70% from pre-recession
levels. Even Embraer’s Phenom series, once
the hottest selling duo of light jets, suffered
a 34% decline in 2011 compared to 2010.
Hardest hit was Hawker Beechcraft. It
only delivered 30 turbofan aircraft in the
first three quarters of 2011 and declined
to provide billings for the fourth quarter
until mid-April 2012. The company was
expected to report a nearly $500 million
loss for 2011 and Standard & Poor’s cut
its credit rating to “D” from “C” in early
April. HBC’s outside accounting firm said
it doubted the Wichita company could
remain a “going concern.”
The midsize and super-midsize
segments, once the strongest performers
in the business aviation market, only
experienced slight upticks in 2011. Unit
deliveries of the Bombardier Learjet 60XR
and Challenger 300, along with Cessna
Citations XLS+ and Sovereign, improved.
Billings for all models of Hawkers, though,
were lackluster.
On the upside, the 2012 Handbook
welcomes aboard the upgraded Cessna
Citation Ten It’s a stretched, more
powerful, more fuel efficient and longer
range Model 750 that will be able to fly
eight passengers 3,200 nm while cruising
at Mach 0.82. When sprinting between the
U.S. East and West coasts, the Citation Ten
should be able to cruise at nearly Mach 0.90.
This year’s Handbook, though, reflects
the realities of the current market. Those
looking closely will notice that several
OEMs, especially light jet makers, have
sharpened their pencils when quoting
prices. Most manufacturers held down
price increases to 2-3% for 2012.
Bombardier actually reduced prices on
all Learjets, plus the Challenger 300
and 605. And Cessna suppressed price
increases to about 1% on most models,
plus it whacked $24,000 off the price of
the CJ3. The fourth-generation Citation
M2, a faster, lighter weight and more-
capable version of the CE525 that it will
replace, is priced $750,000 less than the
2011 CJ1+. Even Embraer held down price
increases to 3-4% for its two Phenom
light jets despite the sharp spike in the
Brazilian real to U.S. dollar exchange
rate.
Heated competition in this weak market
segment created two casualties. HBC
pulled the plug on its $7.5 million Hawker
200 (aka Premier II) and $13.3 million
Hawker 750. Those two aircraft had less
range than their main rivals built by other
manufacturers.
The Cessna Citation Encore+ and
Gulfstream G200 also depart the Handbook,
but they were slated to be replaced by the
Citation CJ4 and G280, respectively, as part
of their manufacturers’ long-term product
strategies. The first G280 (formerly
G250) super-midsize aircraft should enter
service by midyear, providing operators
with much-improved cabin comfort, range
and speed, along with vastly better airport
performance, compared with the G200.
Gulfstream has high long-term hopes for
the G280, but the current glut of super-
midsize jets on the used aircraft market is
suppressing demand, resulting in a slim
order book.
In the long term, though, analysts are
looking for a slow improvement in new
aircraft sales. Many key indicators are
positive, even though the world economy
stumbles through sluggish 2-3% GDP
growth that’s not expected to improve for
at least four years. Meanwhile, corporate
profits in 2011 topped $1.9 trillion, a
new record level. The global population
of high-net-worth individuals neared 11
million people in 2010, with a combined
wealth of almost $43 trillion, according to
Merrill Lynch and Capgemini Consulting.
U.S. auto sales, a harbinger of economic
recovery, are surging strongly as drivers
seek more-fuel-efficient vehicles and trade
in chronically broken clunkers.
Corporate decision makers and high-
net-worth individuals remain uncertain
about the future because of other signs
that point to stagnation or a possible
downturn. They’re reluctant to commit
to purchasing new aircraft. Book-to-bill
ratios, a critical measure of supply and
demand, reflect continued weakness
in order book backlogs. Some analysts
predict that backlogs will remain anemic
for at least three more years.
Last year, aircraft manufacturers
expected the industry to be well poised for
recovery in 2012. This year, only large-
cabin OEMs are smiling. Manufacturers
of smaller business aircraft are buckled in
for more years of stormy going.
Some of these manufacturers may not
be able to weather the rough ride. But the
ones that do survive are looking forward
to a much brighter future by the end of
the decade in North America and Europe,
encouraged in the near term by increased
sales in China, Asia-Pacific, Brazil, India
and Russia. BCA
Dassault Falcon